Less than a month after its Phase III brain cancer treatment failed, San Diego-based Tocagen is undergoing a company restructuring and will reduce its workforce by approximately 65%, the company announced late Thursday.
Less than a month after its Phase III brain cancer treatment failed, San Diego-based Tocagen is undergoing a company restructuring and will reduce its workforce by approximately 65%, the company announced late Thursday.
Tocagen said the restructuring will allow the company to focus its resources on the clinical development of Toca 511 and Toca FC, two-part cancer-selective immunotherapy that includes an investigational biologic, which is Toca 511, and an investigational small molecule, Toca FC. Toca 511 is a retroviral replicating vector that selectively infects cancer cells and delivers a gene for the enzyme, cytosine deaminase (CD). Through this targeted delivery, only infected cancer cells carry the CD gene and produce CD. Toca FC is an orally administered prodrug, 5-fluorocytosine (5-FC), which is converted into an anti-cancer drug, 5-fluorouracil (5-FU), when it encounters CD. 5-FU kills cancer cells and immune-suppressive myeloid cells resulting in anti-cancer immune activation and subsequent tumor killing, according to the company.
It was that combination treatment that failed to hit primary and secondary endpoints in the late-stage Toca 5 trial. That trial was assessing the treatment in patients with recurrent high-grade glioma undergoing resection. The combination did not stand up to the current standard-of-care for those patients, the trial results showed.
Tocagen Chief Executive Officer Marty Duvall called the massive job cuts “an extremely difficult decision.” He said the company is “deeply grateful” to the contributions made by his employees to advance the company’s founding vision “No One Should Die Of Cancer.” Duvall went on to note that Tocagen will use its extended cash position from the restructuring to complete the analysis of the failed Toca 5 trial and then present those results at the upcoming Society for Neuro-Oncology Annual Meeting in November 2019. The company also intends to meet with the U.S. Food and Drug Administration, as well as other regulatory bodies to determine potential next steps for Toca 511 & Toca FC in recurrent high-grade glioma,” he said.
Following the trial failure, Duvall said recurrent brain cancer remains a high unmet medical need and patients with this diagnosis have few treatment options. Duvall said the company’s analysis of the trial data will include molecular analyses and pre-planned subgroups.
The job cuts in the wake of the trial failure are not surprising. Following Tocagen’s announcement about the failed Toca 5 trial, Duvall said the company would conduct an “operational review.”
With the job cuts, Tocagen will be left with 30 full-time employees by the end of the year. It will provide new financial guidance in the fourth quarter of this year. As of June 30, the company had $68.3 million in cash, cash equivalents and marketable securities, according to its most recent quarterly report. Shares of Tocagen are down more than 7% in premarket trading to 65 cents. The stock closed at 70 cents per share on Thursday, a far cry from the $4.11 it was trading at prior to the Phase III failure.
